There was some debate on Bluesky this week about the euro and whether or not joining the single currency would be a stumbling block to Britain’s second accession to the EU - when that day comes, as I am sure it will. Someone who posts as @brexitbin.bsky.social, says Britain wouldn’t be forced to join the euro area, and could make a commitment to joining without setting a date. This caused a bit of indignant pushback from Niall Ó Conghaile, who suggested this is one of the Copenhagen criteria, the conditions set by the EU that all new members must meet before accession negotiations even start. Mr Ó Conghaile is, I think, Irish, anti-Brexit, and a staunch supporter of the EU. He's often quite provocative in his opinions, and I am not sure he’s always right (although he often is).
Here's the exchange:
It’s an important issue because there's little doubt that a significant portion of the British public, even those now opposed to Brexit, worry about the potential need to adopt a new currency. Farage and Company will certainly use it to scare people again. It’s one of the few remaining weapons they have.
It would be naive in the extreme to believe the issue would not be used by the pro-Brexit press to thwart any attempt to get back into the EU, and I believe any campaign will certainly need to have a response. But is it the massive stumbling block Mr Ó Conghaile thinks it is? Would the EU be flexible? I think it would.
I checked out the Copenhagen criteria. One version on the Europa website dealing with enlargement and the eastern neighbourhood, doesn’t seem to mention monetary union at all.
But another, perhaps later version, adds these extra words: "... including the capacity to effectively implement the rules, standards and policies that make up the body of EU law (the ‘ acquis ’), and adherence to the aims of political, economic and monetary union." (my emphasis).
They definitely speak of the euro, but the goal is quite vague, deliberately so I believe. The Eurocrats who drafted the criteria could have been much clearer. Accession countries MUST join the euro, either immediately or within a fixed period of time. But they don't say that.
It’s difficult to be precise about what "adherence to the aims" actually means. If joining the euro was a hard precondition for EU membership, why not say it? Suggesting the criteria means a "formal commitment" is pushing it a bit, in my opinion.
Britain didn't adopt the euro in the first wave when it was launched on 1 January 1999. Eleven EU members did, including Germany, France and Italy. Nine more have joined the euro area subsequently.
During the 2001 election, William Hague put keeping the pound as the main plank of the Tory manifesto while Gordon Brown and Labour were more ambivalent. In June 2003, Brown ruled out joining the euro, "for the time being."
It's worth pointing out that had we done so, Brexit would have been far more difficult and probably wouldn't have happened at all.
Hague memorably described the euro as being 'inside a burning building' with no exits. Well, so far, the building hasn’t caught fire. If anything, the single currency has been a remarkable success, and there is now serious talk, with Trump in the White House and the dollar weakening, of the euro actually replacing the mighty dollar as the world’s reserve currency.
At the moment, seven EU member states are outside the euro area. These are Bulgaria, the Czech Republic, Denmark, Hungary, Poland, Romania, and Sweden. Denmark has an opt out while Sweden is ostensibly committed to joining and has been since 1995, but shows no sign of doing so.
Bulgaria joins next January. Some of the others may or may not follow later. I think if the UK rejoined the EU we would simply be returning to 2003, keeping the pound "for the time being" and becoming one of six EU members (excluding Denmark) that had made the commitment to consider adopting the euro when the time is right.
In any case, these matters are the stuff of realpolitik. If the EU wants Britain to rejoin - and I think they probably do - the euro issue would not be a deal-breaker.
Of course, ditching the pound would be a serious thing. For much of the 19th and the first half of the 20th century, the pound sterling was the primary reserve currency of much of the world. That ended after two world wars had left us destitute, and the United States dollar took its place. And now, the euro may soon replace the dollar. It would be churlish under those circumstances to stick with the pound.
Another big point in favour of the euro is the lower borrowing costs, as Catio Miles points out:
Adopting the € comes with significant advantages, chiefly much cheaper borrowing costs. Today U.K. pays 4.60% on 10 year gilts, other countries in the €zone pay 1 or 2 points lower. Italy for example pays 3.55% 1% benefit on UK’s £2.8 trillion debt is £30 billion interest cost savings per year.
— Catio Miles (@catiomiles.bsky.social) 9 July 2025 at 08:16
We have lost, or are well on the way to losing, £40 billion a year in tax revenue through a drop in EU trade, and it also seems we are foregoing another £30 billion in unnecessary interest payments on our national debt mountain.
You can do a lot with another £70 billion a year. Like doubling defence expenditure, for instance.
Niall Ó Conghaile is wrong. The euro is nowhere near the problem he thinks it is.
